During the savings and loan scandal in the late 1980s, Charles Keating — a wealthy Arizona businessman and chairman of the failed Lincoln Savings and Loan Association — turned to John McCain to ask for his assistance as he was trying to stave off the government intervention. Keating found a champion for deregulation in McCain.
Soon after arriving in Congress, McCain flew on Keating’s corporate plane to vacations in the Bahamas. He “did not pay for most of the trips until years later, when the matter became public.” By 1987, “McCain had received about $112,000 in political contributions from Keating and his associates.” McCain was investigated and ultimately admonished by the Senate ethics committee. Keating went to prison.
McCain’s involvement in the “last great financial scandal in our country” has largely been ignored by the media. But local Ohio reporter Tom Beres finally forced McCain to comment on the Keating Five scandal in an interview yesterday. “Talk of greedy bankers, lax regulation brings back memories of the Keating Five,” Beres reported:
BERES: Is there some relevance of that chapter, which I think you have acknowledged was maybe not your proudest moment?
MCCAIN: It was a very unhappy period in my life. But the fact is that I moved forward and I have been the greatest voice for reform and against corruption in Washington than anybody.
McCain made his comments on the same day the New York Times reported that his campaign manager’s lobbying firm was receiving $15,000 monthly payments from Freddie Mac — a company that McCain has said is rife with “corruption.” Also on the same day, it was reported that McCain’s transition director made $260,000 lobbying for Freddie Mac. The New York Times reports McCain received $169,000 from “directors, officers, and lobbyists for Fannie Mae and Freddie Mac” for the 2008 campaign cycle.
Blogging at the Huffington Post, Jed Lewinson posts a video that explains the Keating Five scandal in 97 seconds: